Sunday, January 12, 2020

A clear and detailed explanation of how Mayor Cooper balanced the budget from Councilman Jeff Syracuse

Below is a clear and detailed explanation of how Mayor Cooper balanced the budget.  This is from the newsletter of Councilman Jeff Syracuse.

Mayor Cooper has made some difficult decisions as we knew he would have to in order to correct our fiscal issues and balance the budget and fill the $41.5 revenue gap. Some of the below is rather complicated. Here is how the revenue gap has been filled and was approved by the State Comptroller:

  •  An agreement with the Convention Center Authority will bring about $12.6 million annually back into the general fund from the Music City Center via a PILOT (Payment In Lieu Taxes) agreement.
  • $10 million via a PILOT with Metro Water Services. 
  • $7.2 million MDHA TIF (Tax Increment Financing) payment reduction ($10.8 million was the total, with $7.2 million to Metro and $3.6 million to Metro Schools). 
  • $3.6 million from the Convention and Visitors Corporation. Debt Service reimbursements for facilities that attract tourists are an allowable use of Tourist Promotion funds under TN Code and the CVC will adjust their spending from that fund to accommodate the $3.6 million reimbursement.
  •  $500k from program reimbursements from Sheriff’s Office / US Marshall Service. The Sheriff will be housing federal prisoners under an existing contract. It’s important to note this contract does not include ICE detainees. This is a net gain of revenue to Metro, and funds will need to be allocated to the Sheriff’s Office to budget for this new programming. 
  • $2.6 million in targeted savings, fund balances and deferrals: 
    • $600,000 of excess fund balance that has built up in the impound lot fund that will be transferred to the General Fund. 
    • $450,000 budgeted for the staffing study and public property performance audit that have not been started and cannot be completed this fiscal year. 
    • $200,000 of the amount budgeted in post audits where current projections indicate this funding will not be needed to close out the fiscal year. 
    • $100,000 of contingency that has not been used and that Finance doesn’t believe will be needed this year. 
The remaining $1.2 million is anticipated excess savings from various departments and agencies throughout Metro. Last year nearly all Metro departments and agencies exceeded their targeted savings amounts by a collective total of $8.8 million. Departments and agencies continue to be mindful of the need for savings and based on mid-year budget meetings, we believe they will again collectively exceed savings targets. 
  • Of the budgeted $10 million for the Barnes Fund that goes towards assisting affordable housing projects, only $5 million will be awarded. The Mayor has said this is a partial impoundment of this fund and will strive to ensure it is put back in future budgets. This does delay some critical affordable housing projects from moving forward. 
Another decision that was made that I fully support is $18 million that was debt already approved for the Gulch pedestrian bridge has been reallocated for other critical infrastructure projects, traffic calming, street lights and needed new trash cans around the county. In addition, the promised extra 3% pay increase last summer that teachers would get starting January 1, 2020 was kept under the new administration. So, where do we go from here? As this upcoming budget planning cycle is absolutely critical, there is agreement to start it early. Our fiscal year is July 1, but the budgeting process has already been started in the administration and the cycle will be moved up one month to June 1, so that the Comptroller has ample time to oversee and approve that we have improved cash management, redevelop adequate reserves. 

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